Tonight, a major court ruling in Israel that goes to the heart of the Israeli-Palestinian conflict, even as it's sparking an outcry from Palestinians and their supporters around the world. It is the case of Rachel Corrie. Now you may remember she's the young American activist who was killed nine years ago while she attempted to block a bulldozer from destroying a Palestinian home in Gaza.

The Israeli court ruled that the death was an accident. It says the bulldozer's drivers are not to blame because they couldn't see Rachel Corrie. Other protesters who were with her that day say that's simply not possible.

I want to show you some photographs that were taken the day she was struck. She was wearing a bright orange vest, seemingly hard to miss, unless the bulldozer operator's view was obstructed as he claimed. Her companions say she was standing in clear view of the driver just before the bulldozer moved forward.

Now we can see both angles in these pictures. But we cannot be certain of her exact position when she was actually hit and went down. She was pronounced dead later that day in hospital.

The death of Rachel Corrie became a rallying cry for the Palestinian resistance. A play based on her writings has been performed in almost a dozen countries, a ship that attempted to bring aid to Palestinians in a blockaded Gaza Strip was named after her. The Palestinian soccer team created an annual tournament in her honor and in Tehran, a street bears her name.

So what of the charges that the Israeli investigation into her death was not credible? Well, tonight, both sides. I'll speak with Rachel's father, Craig Corrie, and then to the spokesman for the prime minister, Benjamin Netanyahu, Mark Regev.

But first, a look at what's coming up a little later in the program.

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VELSHI (voice-over): Mitt Romney wants to be the next president. If he wins, America's relationships around the world could change dramatically.

And poverty in Europe: while governments look for big solutions, one giant company is thinking small.

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VELSHI: And we will get to all that in a bit, but first to Craig Corrie. He is the father of Rachel Corrie, the American activist who was run over by a bulldozer and killed while protecting demolitions in Gaza.

Craig, thanks very much for joining us. I know it's been nine years but it probably doesn't ease your burden very much. What is it that makes you think that the Israeli investigation into Rachel's death wasn't fair?

CRAIG CORRIE, FATHER OF RACHEL CORRIE: Well, we've learned a lot by being in court. And so some of that is that simply, for instance, the investigator went out and picked up some information, but for instance, there was a film that was recorded from the Israeli tower. IDF recorded that film and the investigator didn't get that until a week after Rachel was killed.

Then when he got a copy of it, it seems he didn't get the entire copy, because the whole world has seen parts of that that were not presented to court, and the investigator said no more existed. So that's simply an instance of that.

And I'd also like to repeat that it is the long-standing position of our government in the United States, stated since the State Department said it in 2004, that it has not been a thorough, credible and transparent investigation, even though that was promised by Prime Minister Sharon to President Bush. It still has not been fulfilled.

VELSHI: That's interesting, because we were talking to State Department, trying to get some clarity on that. You spoke to Dan Shapiro, America's ambassador to Israel. And what did he tell you about this investigation?

CORRIE: Well, he told me that the position in American government has remained as it was stated back then. And of course, it's on record. It was in a letter to our family from then -- it was Colin Powell, who was the secretary of state at the time. His chief of staff wrote it, that letter. It was repeated a year later in -- by a person who was testifying in front of Congress and repeated it again.

So and then it's been repeated more recently by the White House and high officials in the White House. So I -- it's my understanding that that position has not changed.

VELSHI: And to be clear, when you say that position, what is it that they told you?

CORRIE: They told us that the -- that the investigation done by the Israeli military was not thorough and credible and transparent. And that was the promise that was made to our president (ph). I'll go on and say this: we have found a little more of the video; actually what was president in court was a little different than was given to our government.

When you look at that further video, you can see the people coming with a stretcher to come out and pick up Rachel. Through that video, you can clearly see where Rachel's body was.

What was reported by the Israeli government to our government, the U.S. government, in a PowerPoint presentation was given shortly after Rachel's killing, shows one segment of that video, just you know, a single shot. And it says, "Here's where Rachel's body was. See, here's the bulldozer and there's a mound of earth, so they can't see her."

Well, when you watch the full video and you see the remaining video that we've been able to get, you can see the stretcher bearers walking right past there. That wasn't the bulldozer that killed Rachel.

That wasn't where Rachel's body was. And that wasn't the position in which the bulldozers were going at the time. And when you see that further video, you can see that anybody watching that would know. So it's not just a mistake, it's a knowing mistake --

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VELSHI: OK, so --

CORRIE: -- a material fact from high-level officials in the Israeli government to U.S. officials.

VELSHI: All right. So you think that high-level officials in the Israeli government were misleading to U.S. officials, but when you think about this investigation, what is your complaint, that it was sloppy and that it was -- the military protecting its own? Or do you think there was something higher up? Do you think there was more to it than that?

CORRIE: Well, I think, first of all, you know, I mentioned about securing this tape. But if you look at the testimony, for instance, there were two bulldozers at -- there that day. Each bulldozer had an operator and it had a commander who sat right next to him, a little bit to his left and a little higher.

And then there was also an armored personnel carrier that was there in command of the whole operation.

Well, for instance, the bulldozer operator and the commander had entirely different stories about for instance, where they saw Rachel's body right after she was killed.

The bulldozer operator says that when he backed up, he saw Rachel's body between him and the mound of earth that he was pushing, which is where our witnesses, the people, friends of Rachel's took the pictures and you may even have copies of those pictures.

The person sitting right next to him said her body was down the other side of this mound of earth and that he saw it lying behind a 2-meter high pile of earth. I don't know how he could have seen her lying on the ground there. And he testified to that.

Well ,the person doing the investigation never confronted one of the people with the testimony of the other. He just put those two pieces of paper in a file and called it a day.

You know, what's up with that? If you're going to do an investigation, you go look for the truth. You go ask these people and you ask them over and over again. You confront them. You go and get the pictures that were -- Rachel's friends had, which were on the Internet.

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VELSHI: So, Craig, you say --

CORRIE: And people had it -- they had them available. You go talk to the ISM. You (inaudible) and you find out what happened.

VELSHI: When you say what's up with that, what do you think is up with that? What is -- what do you think the reasoning is? Is just this a matter of the military not wanting to admit wrongdoing? Or do you think Rachel was deliberately killed and the Israelis don't want to admit that?

CORRIE: Well, the investigator said he thought that Israel was war at everybody in Gaza, including the peace activists, you know. And Rachel was the -- our own State Department says that she was a human rights observer there.

So there is a bias that's obvious, coming from that guy. I think that a thorough investigation might have shown more, you know. I don't know who's covering up what, but if somebody lies, you have to ask why they're lying. Adults, if they simply had made a mistake, adults admit that. And that's wasn't the case with the Israelis here.

So unfortunately, without a full investigation, our family, for instance, has never, in nine years, said that Rachel was murdered. But when you go through all of this process and you see these statements and you see what was put here, you have to ask yourself what are they hiding? And I think that's an important question.

I also would say, you know, and go back to the court proceedings here, we came to court in Israel, looking for a fair hearing. And one of the huge problems with that is the first finding of the judge here was that it was a military operation and so he had not to question anything else that happened there because it was in Gaza, which he said was the time of war.

A, Gaza is under occupation. It wasn't a time of war. B, I was in the military in Vietnam. I, in fact, part of my duties was to be occasionally in charge of bulldozer operations. First of all, you have to know what's in front of the blade. That's incredibly important.

Second of all, it depends day by day. We know that there are civilians in Gaza. There's civilians anywhere you have a war. And those civilians have rights no matter what.

So you can't just blanketly say that whatever the military does, when there's a time of war, that that's OK. And that's international law and we have enormous reasons to continue to support that international law. And I hope that Sunday Israel comes to recognize it as well.

VELSHI: And it's understandable. Craig, that as a father you want answers. Craig Currie, thanks for joining us, and of course, our condolences again.

Well, now to how Israeli officials view today's ruling, we turn to Mark Regev. He's the spokesman for Prime Minister Benjamin Netanyahu.

Mark, thanks for joining us. What's your take on this? When you review all of this -- and I know you've had a chance to and you followed it well -- how do you see Rachel Corrie? Is she a victim? Was she misguided? Or, as the Israeli court said, deliberately put herself in harm's way? How do you -- how do you see Rachel?

MARK REGEV, SPOKESMAN FOR PM BENJAMIN NETANYAHU: Well, first let me start off by extending once again condolences to the Corrie family, as they've had a terrible tragedy. They've lost their daughter. And I think any human being has to empathize with him and has to feel for the Corrie family.

I don't accept the criticisms we've heard of the Israeli judicial system. We've had three investigations. There was the on-the-ground military investigation. Then there was a military police investigation. Then there was an investigation by a full general. And then all this has now been under the study of a civilian court, which has looked for months now at all the evidence.

So I understand that the Corrie family didn't get the decision they wanted from the courts. But we have in Israel checks and balances. We have independent courts. And it's clear to me that the judge got to the bottom of this matter.

VELSHI: So a part of what I seem to glean from Craig Corrie's complaint is that of those investigations you just named, three of them were either military or police.

And there's generally a sense that these investigations, when something is alleged to have been committed by military or police, you know, a lot of world thinks that the investigation is more fair when it comes from the outside.

But that the initial investigations weren't fair. You heard that Craig said that he had spoken to U.S. Ambassador to Israel Dan Shapiro, who said that -- who apparently told him that he didn't think -- the U.S.' position is that the investigation was not credible, thorough or transparent enough.

What do you think about that?

REGEV: I can't speak for the U.S. government, but I do know that Americans and people who live in democracies can appreciate than an independent judiciary, who makes independent decisions and, quite frankly, yesterday, before this decision, we were speculating how the judge would rule.

The fact that he's ruled for us is a vindication of our case. I'd like to say, if I could, about the investigation as a whole, listen, it all came down to did the driver of that tractor, could he see that Rachel Corrie was in front of him.

VELSHI: Right.

REGEV: Now we brought expert witnesses to the court, and the Corrie family also under our legal provisions brought their own expert witness that the family nominated. Now all of them agreed, including the expert witness that the Corrie family nominated, that there simply wasn't vision, that they couldn't see -- the driver was unable to see if Rachel Corrie was in front of the tractor.

We really -- our rules are very strict. You cannot run over innocent civilians. It's as clear as that. And if we thought the driver had acted in such a way, he'd be in jail today. But all the independent investigation -- once again, the experts, both from our side and from the Corrie side, ruled that he could not have seen Rachel Corrie.

VELSHI: Right. Those are various reports that this is a -- this was a common practice, that these protesters would wear these bright orange vests and we have pictures showing Rachel Corrie. In fact, we've got pictures taken the day she was killed, where you see various angles and you see the cabin of that bulldozer and you know, again, we weren't there. So we don't know.

But it does look that -- it looks like she could -- you could see the pilot. You could see the bulldozer driver in one of the pictures from her perspective. This one that we're looking at right now.

Bottom line is you said that if you felt that this driver -- the bulldozer operator had done something deliberately, he'd be in jail. There have been complaints about the Israeli military, by human rights groups, who say that the military is not held accountable adequately for these types of things.

What's your response to that?

REGEV: Well, let me respond, first of all, by pointing to the pages of testimony -- and they're all open and they're open to transparent discussion. But when -- the judge said today that when the driver of the tractor saw the activist, saw Rachel Corrie, he actually moved away on a number of occasions, trying to avoid them. That's also part of the testimony.

So it's clear to me that he didn't see Rachel Corrie because we have evidence, clear evidence of his previous behavior, where he tried to avoid her. I also want to say that you actually said something that is not true.

At the beginning of this piece, when you said Ms. Corrie was trying to protect a house that was going to be destroyed or something. That's not true. In the court decision, it's very clear the Israeli military was in operation to clear a zone of bushes and shrubs and small trees which were being used by snipers.

There were also explosive in that areas, EIDs (sic), I mean, this was a combat zone between hardcore terrorists and armed military. And we were trying to, once again, to expose sniper positions and get rid of these dangerous explosives. This was not a -- nothing to do with savings homes.

VELSHI: We -- obviously that's in dispute because it's very clear by the organization that Rachel was working with that that's what they were doing there. They were trying to prevent homes from being destroyed.

Let me ask you on another topic --

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REGEV: Can I --

VELSHI: Yes, go ahead, Mark.

REGEV: Can I respond to that?

VELSHI: Yes.

REGEV: Can I respond to that, please? I mean, the organization that Rachel was part of, Rachel Corrie, is not known for its objectivity. This is a very hardline radical organization that does not believe in peace and coexistence.

They say that Israel has no right to exist. They've got a very black- and-white view of our conflict with the Palestinians. We are the devils, we're terrible and the Palestinians have never done anything wrong. They're very -- I'm not sure you can accept their testimony as objective truth.

VELSHI: All right. Well, unfortunately, we don't get to hear Rachel's testimony in this particular case.

Mark, thanks very much for joining us. We appreciate you being on with us.

Mark Regev is a representative of the Israeli government.

All right, when we return, how would America's relationships around the world change if Mitt Romney becomes the president? We'll have more on that when we come back.

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VELSHI: Welcome back to the program. I'm Ali Velshi, sitting in for Christiane Amanpour. Yesterday, we took a look at how Mitt Romney is seen around the world. So today we want to look at how Mitt Romney sees the world and how he might change U.S. foreign policy positions if he were elected.

Ari Fleischer is a former White House spokesman for President George Bush. He's a CNN political contributor and we share a barber.

Ari, good to see you. He is at -- he is in Tampa for the convention.

Ari, here's the thing. It is Mitt Romney's job to try and make himself look like somebody who's going to do things differently from Barack Obama. It's a little hard to find these distinctions on foreign policy. Let's start with Syria, for instance. Mitt Romney has taken a position that he would -- he would move to arm the rebels, the Syrian rebels.

That seems to be the clearest distinction. Tell me a little more about this.

ARI FLEISCHER, CNN POLITICAL CONTRIBUTOR CONTRIBUTOR: Well, I think that is the biggest distinction. The Obama administration has made the judgment that we don't know who the rebels are; we don't want to arm them. And Mitt Romney has said publicly he would arm them. And that's a pretty profound difference.

Obviously, if you're fighting for what the Syrians call freedom on the ground, you're going to be very grateful to those who give you the tools with which to achieve that freedom. So that a pretty profound difference in a very tricky spot where, frankly, any American president's only going to have limited influence.

VELSHI: Right, and I think you could also agree that this thing, this situation could change. We obviously took a different position in Libya. Francois Hollande has suggested that the Free Syrian movement, the rebels form a provisional government that could then take support of other nations.

Do you think that a Mitt Romney as president would support that?

FLEISCHER: It seems to me he would, reading into what he has said about Syria and the need to have a government that respects the (inaudible), respects the rights of its people, gets rid of its chemical weapons, I -- you know, I don't speak for the Romney campaign, but reading between the lines of their foreign policy, I think Mitt Romney would support that.

VELSHI: Let's move over to Iran for a moment and talk about what goes on there. What would Mitt Romney do differently than Barack Obama? Before I get your answer on this, let's listen to what Mitt Romney has had to say about what he would do.

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FORMER GOV. MITT ROMNEY, R-MASS., PRESIDENTIAL CANDIDATE: Look, one thing you can know and that is if we reelect Barack Obama, Iran will have a nuclear weapon. And if we elect Mitt Romney, if you elect me as the next president, they will not have a nuclear weapon.

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VELSHI: Leaving alone the idea that I'm not sure Barack Obama would agree with the statement that if we reelect Barack Obama, Iran will have a nuclear weapon, what is it that Mitt Romney would likely do to prevent Iran from having a nuclear weapon?

FLEISCHER: Ali, there are two big differences in Romney's approach to Iran from President Obama's. One is Mitt Romney said Iran cannot have nuclear weapon capability. President Obama has said they can't have weapons.

And let me try to explain that in a way that people can relate to. The difference is let's say you're climbing a high dive and you count each step along the high dive, and you walk off to the platform. You're at the very edge of the platform. With one more step, you will hit your target.

The difference is Mitt Romney is saying I won't let you climb that platform. President Obama is saying I won't let you hit your target. Big difference. If you keep somebody off of that high dive, you're never going to get near the water. Problem is if you say you won't hit your target, once they take that final step, there's no way to stop them. They're on their way down. Big difference between --

VELSHI: All right --

FLEISCHER: -- and actual weaponization.

VELSHI: And there's a --

FLEISCHER: Big difference there.

VELSHI: -- and there's also a big difference between tough talk and what you actually do to get there. So what would Mitt Romney do? Because this is not an area that the United States shares a view with the entire world. So what would Mitt Romney do? If he wants to move ahead, the main person pushing that is going to be Israel, the main group pushing this.

FLEISCHER: Well, what it really comes down to is whether the threat of force is a credible one or not. President Obama has used those bland words that everything is on the table, and then the president was undercut by his own Defense secretary, who said, well, the military option is really not on the table, said Leon Panetta, the Defense secretary.

So if you're Iran and you hear that, you think military option is not something the United States will actually engage in. Mitt Romney is saying kind of like Ronald Reagan used to in the `80s, he'll follow things through. He will act.

And people feared Ronald Reagan. I think that's what Mitt Romney is trying to recreate. So the question is is Mitt Romney being credible when he says he would use the military, is what he's really saying between the lines.

Big issue. Big issue, Ali, because nobody in America wants to go to war again.

VELSHI: Right.

FLEISCHER: We've seen what happened in Iraq. A lot of consequences went wrong. On the other hand, I don't know anybody who thinks that if Iran has a weapon, it won't use a weapon.

VELSHI: Right. So --

FLEISCHER: The only thing worse -- the only thing worse than letting them have it is go to -- the only thing worse than going to war --

VELSHI: And I would say to you --

FLEISCHER: -- is letting them have it.

VELSHI: I would say, Ari, that the whole idea of going to Iraq was that the nation was largely convinced that they had weapons of mass destruction.

The issue here is that some say that Iran has that capability; they've built that ladder and that diving board and are close to being able to walk off the edge of it, and others are saying there's simply not enough evidence to justify getting the world involved in a war.

FLEISCHER: Well, those are valid points. And this is the hardest thing about intelligence. I saw this in the Bush administration. We were told the exact same thing the Clinton administration was told, that Saddam had weapons of mass destruction. Turned out to be wrong.

We don't know who's right and who's wrong about Iran. But once again, the world intelligence community is saying that Iran is on the verge of acquiring them.

And certainly when you listen to the president of Iran, Mahmoud Ahmadinejad, say he will wipe Israel off the map, is that something the United States can stand by and allow to happen? Should we stand by, take the risk, let Iran develop the weapons? These are why presidential decisions are terribly hard decisions to make.

VELSHI: Ari, always a pleasure to see you. Good. Thanks for making it through there. I know there's -- it's a loud convention going on and a lot of stuff going on behind you. Thanks for being with us.

FLEISCHER: (Inaudible).

VELSHI: Ari Fleischer is a CNN contributor.

And we are back in a moment. Stay with us.

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VELSHI: A final note tonight, imagine the third world teaching the first world how to fight poverty one little package of soap at a time.

According to the European Commission, 23 percent of E.U. citizens, over 115 million people, are now faced with the threat of poverty. At the low end, there's Sweden with 15 percent of its population at risk. But economic powerhouse Germany comes in at a surprising 20 percent; struggling Greece, almost 28 percent.

While governments debate the euro and other macroaspects of the crisis, Unilever, the Anglo-Dutch consumer giant responsible for brands like Dove, Lipton, Knorr and Vaseline, well, they're thinking small.

Using the marketing skills it developed in Asia, Unilever has begun to promote cheaper, smaller packaging in Europe -- for instance, selling washing powder that only lasts five washes. Of course, in the U.S., supersizing remains a way of life. But if the economy continues to stagnate, thinking small may be the next European import.

That's it for tonight's program. Thank you for watching. And goodbye from New York.